Howe School Faculty at the 2013 Babson College Entrepreneurship Research Conference

7/23/2013

Professor Tonoyan Presents a Paper

Vartuhi Tonoyan, Assistant Professor at the Stevens Institute of Technology, and Research Fellow at the Department of SME Research and Entrepreneurship at the University of Mannheim in Germany, and Garry Bruton, Professor at the Texas Christian University and Co-director of the Institute for Global Innovation and Chinese Entrepreneurship at Tongji University in China, Presented a Study on the Effect of Corruption on Firm Innovativeness at the June 2013 Babson Conference of Entrepreneurship Research in Lyon, France.

IS CORRUPTION A BARRIER TO FIRM INNOVATIVENESS? A CROSS-NATIONAL COMPARISON OF EMERGING AND MATURE MARKET ECONOMIES

In emerging economies, entrepreneurs and business owners are frequently confronted with challenges associated with corrupt governments and inefficient institutional environments. A growing body of research has already demonstrated various macro-economic consequences of corruption for the economic welfare. We move the analysis of corruption from aggregate levels toward entrepreneurial and managerial theory and practice by examining the effect of the spread of corruption on firms’ decision to implement and develop innovations. Building on two contradicting theoretical strands from corruption research as well as the new institutional economics, we test whether corruption sands the wheels of innovation or it greases the wheels of innovation. Employing a rich data on about 8,000 firms from 38 emerging and mature market economies, we find that corruption has a significant positive impact on firms’ innovativeness. We discuss this result against the backdrop of prior work’s findings, as well as the strengths and limitations of our data, and develop implications for future research.

About Babson College Entrepreneurship Research Conference (BCERC)

Founded by Babson College in 1981, BCERC is considered to be the premier entrepreneurship research conference in the world. The Entrepreneurial Research Conference was established to provide a dynamic venue where academics and real-world practitioners, through spirited dialogue, could link theory and practice. Each year, the Conference attracts more than 350 entrepreneurial scholars who come to hear the presentation of more than 220 papers.

Frontiers of Entrepreneurship Research papers contain the proceedings of the conference and are the most comprehensive collection of empirical research papers on entrepreneurship. A Doctoral Consortium is held in conjunction with the Conference and was created as a means to unite future entrepreneurship educators and scholars with established leaders and researchers in the field.​